Gst On Freight

watch_later 3 years ago

When buyer is paying freight to supplier against his invoice then GST @ of highest GST rate of material is paid.

My questions are that,

  1. if Buyer is paying freight charges directly to the transporter then he has to pay the GST or not?

2. If he has to pay GST to the transporter then, is the GST rate required to be mentioned in the Purchase order or not?(as P.O. is between buyer & supplier on freight payable at actual basis)

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1 Answer

GST Payer watch_later 3 years ago

First make agreement specific. Under GST scrutiny, agreements will be checked thoroughly to estimate tax liability after reference to valuation provisions.

Second, the one who make payment to transporter has to pay tax under RCM. If you are paying directly to transporter then yes, you have to pay tax under RCM at the rate of 5%.

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